Planning Ahead for Care: LPAs, Costs and Care Choices

FIRST AND MOST IMPORTANT

Lasting power of attorney

If you do one thing after reading this page, do this one. A lasting power of attorney lets someone the person trusts make decisions on their behalf if they become unable to make them. It has to be made while they still have the capacity to make it, and it has to be registered with the Office of the Public Guardian before it can be used.

There are two types and you generally want both

A property and financial affairs LPA covers bank accounts, bills, pensions, benefits and, if it comes to it, selling a property. A health and welfare LPA covers medical treatment, day-to-day care and where the person lives. They are separate documents and a great many families make only the financial one, then find themselves with no standing at all in a decision about a care home. Make both.

Registration takes time, so start early

Registration with the Office of the Public Guardian is not instant, and an unregistered LPA cannot be used. A registration fee applies to each document, with reductions or exemptions available for people on low incomes or certain benefits. You do not need a solicitor to make an LPA, though it is sensible to take advice where there is property, a business, a blended family or any likelihood of disagreement.

Choose attorneys carefully, and more than one

Appoint at least one replacement attorney. Decide deliberately whether attorneys must act together on everything, or can act separately — requiring unanimity on every decision sounds safe and in practice paralyses things when one attorney is abroad or unwell. Talk to the people you are appointing before you name them.

If capacity has already gone

An LPA is no longer possible. The route is an application to the Court of Protection for a deputyship order, which takes months, costs considerably more, and comes with ongoing supervision and annual reporting. It works, but nobody who has done it recommends waiting.

The planning-ahead checklist

Lasting power of attorney — property and financial affairs
Lasting power of attorney — health and welfare
Both registered with the Office of the Public Guardian
An up-to-date will, and everyone knows where it is
An advance decision or advance statement, if wanted
A benefits check — Attendance Allowance, Pension Credit
A list of accounts, policies, pensions and passwords
A named GP, and a recent medication review
A written note of what the person wants, in their words
An honest family conversation about money, once

THE DOCUMENTS

What each document actually does

Health and welfare LPA

Lets an attorney make decisions about treatment, care and where the person lives, but only once they can no longer make those decisions themselves. It can include or exclude authority over life-sustaining treatment, and you have to choose which.

Property and financial affairs LPA

Can be used as soon as it is registered, with the person's permission, or later if capacity is lost. This is the one that keeps bills paid and, when necessary, allows a property to be sold to fund care.

Advance decision to refuse treatment

A legally binding refusal of specific treatments in specific circumstances. To refuse life-sustaining treatment it must be in writing, signed and witnessed, and say clearly that it applies even if life is at risk.

Advance statement

Not legally binding, but genuinely useful. It records preferences — routines, food, faith, who they want around, what matters to them — and must be taken into account in any best-interests decision.

Will

Separate from everything above and easily forgotten in the middle of a care crisis. If a property may be sold to pay for care, it is worth reviewing the will at the same time rather than years later.

Deputyship order

The Court of Protection route when no LPA exists and capacity has gone. Slower, more expensive and supervised. Available, but it is the position you plan to avoid.

THE HOUSE

What not to do with the property

The most common piece of well-meant advice families receive is to sign the house over to the children to protect it from care fees. It is also the advice most likely to cause harm, and it is worth understanding exactly why before anyone signs anything.

Deliberate deprivation of assets

If a local authority concludes that assets were given away in order to avoid or reduce care charges, it can treat the person as though they still owned them. That is called notional capital, and the practical effect is a bill for care that nobody has the money to pay. There is no fixed period after which a gift becomes safe: what matters is the intention at the time and whether care was a reasonably foreseeable prospect. The frequently repeated seven-year figure comes from inheritance tax and has nothing to do with care fees.

The twelve-week property disregard

When someone moves permanently into a care home, the value of their former home is disregarded for the first twelve weeks of the financial assessment. It exists to give families breathing space rather than forcing an immediate sale. Know about it before you put the house on the market in a panic.

When the home is disregarded indefinitely

The property is not counted at all while certain people still live there — a spouse or partner, a relative aged sixty or over, a relative who is incapacitated, or a child under eighteen. Councils sometimes also apply a discretionary disregard in other circumstances. This is worth checking carefully rather than assuming the house is in play.

Deferred payment agreements

Where the home is the main asset, a council can agree to defer care fees against the property, effectively lending the money until the house is sold or the estate is settled. Interest and administration charges apply. It is a legitimate and often sensible option that avoids a forced sale, and it is under-used because few people are told it exists. Full detail is in the care costs guide.

Before anyone transfers anything

Get the current care needs written down properly
Check whether the property would be disregarded anyway
Understand notional capital before, not after
Take regulated advice on anything involving investments
Take legal advice on anything involving a transfer of title
Consider a deferred payment agreement instead
Ask what happens to the other person living in the house
Write down the reason for the decision, dated

DO IT IN THIS ORDER

A sensible sequence

1

Have the conversation once, properly

Not a series of hints over three years. One conversation, with the person at the centre of it, about what they would want and what they have. Write down what is said.

2

Make and register both LPAs

Everything else is easier once these exist. Start them now, because registration takes time and capacity is not something anyone can schedule.

3

Do a benefits check

Attendance Allowance is not means-tested and is routinely unclaimed. Pension Credit can open the door to other help. Carer's Allowance may apply to whoever is doing the caring, subject to an earnings limit.

4

Map the money honestly

Income, savings, property, pensions and any existing commitments. Then model what care would actually cost with the fees calculator, so the number is known before it is urgent.

5

Write down what good would look like

Where they would want to be, what they would not accept, who they want involved. This is what turns a rushed hospital decision into a decision that already had an answer.

WHO TO ASK FOR WHAT

The right person for each question

A lot of avoidable cost comes from asking the wrong professional the right question. This is roughly how the work divides up.

What you need	Who does it	Roughly when	Note
Lasting power of attorney	Yourselves, or a solicitor	While capacity is intact	Registration takes weeks, so start early
Will, trusts, transfers of property	A solicitor	Before any care crisis	Reserved legal work — we do not do this
Investments, annuities, care fee plans	An FCA-regulated adviser	Once the fee level is known	Regulated advice — we do not do this
Needs assessment and means test	The local authority	As soon as needs appear	Free, and a right under the Care Act
Continuing Healthcare	The NHS	Before a placement is agreed	See the CHC guide
Choosing and checking providers	Independent care advice	Before anything is signed	This is what we do

FOR THE PERSON DOING THE CARING

Plan for the carer as well

A carer's assessment

A legal entitlement in its own right, separate from the person being cared for. It considers whether you are able and willing to keep going, and can lead to practical support. Ask the local authority for one.

Respite before it is needed

Regular short breaks established early are far more effective than emergency respite arranged in a crisis, and they make any later move much less frightening for everyone.

A contingency plan

Write down what happens if the main carer is ill for a fortnight. Who is called, in what order, and what they need to know. Most families have never done this and it is an hour's work.

COMMON QUESTIONS

Questions about planning ahead

Do I need a solicitor to make a lasting power of attorney?

No. Many people complete them without one. It is worth taking legal advice where there is a property, a business, a blended family, anyone likely to object, or where the person's capacity might later be questioned. A badly made LPA that is rejected on registration costs more time than getting it right first.

Can I use an LPA as soon as it is signed?

No. It must be registered with the Office of the Public Guardian first, and that takes time. A financial LPA can then be used with the person's consent while they still have capacity; a health and welfare LPA can only be used once they cannot make the particular decision themselves.

What happens if there is no power of attorney and capacity is lost?

Nobody automatically gains the right to act — not a spouse, not a child. The route is an application to the Court of Protection for a deputyship order, which typically takes months and involves ongoing supervision and reporting. Meanwhile bills still need paying, which is where the real difficulty bites.

Can we give the house to the children to avoid care fees?

You can transfer a property, but if a council decides it was done to avoid care charges it can assess the person as if they still owned it. That leaves a care bill against money the family no longer has. There is no safe waiting period, and the seven-year rule people quote relates to inheritance tax, not care fees. Take proper legal advice before any transfer.

Will the council take the house?

No. Councils do not take property. The house may be counted as capital in a financial assessment, which is a different thing, and it is disregarded entirely while certain people still live there — a spouse or partner, a relative aged sixty or over, an incapacitated relative, or a child under eighteen. Where it is counted, a deferred payment agreement can avoid a forced sale.

Is Attendance Allowance affected by savings or a pension?

No. It is not means-tested and it is not taxable. It is paid on the basis of the help someone needs, not what they have. It is also one of the most commonly unclaimed benefits in the country, particularly among people who assume they are too well off to qualify.

What is the difference between an advance decision and an advance statement?

An advance decision is a legally binding refusal of specific treatment in specific circumstances, and to cover life-sustaining treatment it must be written, signed and witnessed. An advance statement records wishes and preferences more generally; it is not binding but must be taken into account when decisions are made in someone's best interests.

How much money should we assume care will cost?

Not a national average — use the actual fee for the actual home you are considering, because averages vary enormously by region and setting and none of them will be your number. Once you have a quoted fee, the calculator will show you the weekly shortfall after income and benefits, and roughly how long savings would last.

When is the right time to start all this?

Before anyone thinks it is necessary. In practice, a good trigger is any of the following: a first fall, a new diagnosis, a hospital admission, the death of a spouse, or the point at which one adult child starts quietly doing the shopping every week. If any of those has happened, it is time.

Can My Care Direction help with this?

We help with the care side: working out what is actually needed, what it will cost, which funding routes apply and what to do next. We are independent and nurse-led and take no commission from providers. We do not provide FCA-regulated financial advice and we do not carry out reserved legal activities such as drafting wills or transferring property. Where those are needed we will say so and introduce you to a regulated professional.

You don’t need to know which service you need.

Just tell us what’s happening.

Book a Free 20-Minute Care Needs Call Take the 2-Minute Care Check

No pressure. No care-provider commissions. Just a conversation about what may help.

Planning ahead: the decisions worth making early